STMC is a machinery components manufacturer that supplies parts for textile machines. The document provides a situational analysis of STMC and recommendations for marketing strategies. It discusses doing a SWOT analysis, focusing on customers, differentiating from low-cost rivals through quality and service, competing against the major competitor TMMC through differentiation and customer satisfaction, and implementing pricing strategies like premium pricing, price skimming, and penetration pricing. The goal is for STMC to double its sales through strategic marketing.

1. Submitted by-Ruchira
Panigrahy (UEMF16013)
Saurav Pattanaik
(UEMF16016)
EMBA
2016-17
STRATEGIC MARKETING:
CASE STUDY ON “SUDHIR TELANG”
MACHINERY COMPONENTS

2. 1
Table of Contents
SITUATION ANALYSIS:................................................................................2
SWOT ANALYSIS OF STMC.........................................................................2
RECOMMENDATIONS FOR THE MARKETING STRATEGIES: ...................3
COMPETITIVE ADVANTAGES..................................................................3
BEING MORE CUSTOMER FOCUSSED ...................................................4
STRATEGIES TO FIGHT AGIANST LOW COST RIVALS ...........................4
STRATEGIES TO FIGHT AGIANST COMPETITORS : ...............................7
PRICING STRATEGY .................................................................................8
MARKETING STRATEGIES TO BE FOLLOWED .......................................9

3. 2
SITUATION ANALYSIS
 SudhirTelang Machinery Components (STMC) was introduced in 1973
 Present business of STMC:
o Selling spares and components for Tasaku Textile machine
o Deals with only casting and machining of components
o These machines were manufactured by Textile Machinery Manufacturing
Company (TMMC)
o TMMC : Sales in 1976 was Rs.10 cr
o Tasaku Textile machine:
 Total number of machines : 11000
 Each of the 11000 machines had 3500 components
 Business plan and target :
o Be a spare and components manufacturer in the Indian market and
considering multiple marketing strategies for its new line of products
o To double its sales from Rs. 15 Lakhs in 1977 to Rs.30 Lakhs in 1978
SWOT ANALYSIS OF STMC

4. 3
RECOMMENDATIONS FOR THE MARKETING
STRATEGIES
COMPETITIVE ADVANTAGES
Competitive advantages are conditions that allow a company to produce a good or
service at a lower price or in a more desirable fashion for customers. It provides an
edge over rivals and an ability to generate greater value for a firm. There are 2 types
of competitive advantages:
 Comparative advantage:
A firm's ability to produce a good or service at a lower cost than its competitors.
Here the competitors for STMC are:
o The big market leader TMMC who sells the product directly to Tasaku
Textiles
o The low-cost rivals or the small machine shops manufacturers who sell
their products indirectly through established suppliers to Tasaku Textiles
o STMC’s current Pricing Strategy :
 Uses Cost + Margin Formula for pricing the products
 Single price offer for all types of buyers
 Sells without incurring any loss
 Differential advantage :
Differential Advantage is a benefit or cluster of benefits that customers value and
believe they cannot obtain anywhere else.
The basic key areas on which STMC can focus on are:
o Quality: The competition can be met by offering superior quality than
others. The advantages of STMC is that it manufactures “High quality”
products which would mean less down time for machines, less
replacements and lower labour charges for the replacement of the parts
o Price: The competition can also be met by choosing to beat the
competitor by offering the lower/optimal prices depending on the type
of competitor
o Service: The competition can also be met by choosing to beat the
competition by offering an unforgettable customer service.
 There’s always an alternative to quality; if STMC focuses on only offering the
highest quality at a premium price, customers will scout around for a lower
quality at a cheaper price.
 There’s always an alternative to price; if STMC focuses on offering the cheapest
price possible it will require that it finds a way to drive down its cost to the barest

5. 4
minimum. And this can turn out in form of low quality products or services and
customers will start to complain.
 STMC can complement the price or quality with its services in order to stand in
the market.
BEING MORE CUSTOMER FOCUSSED
As very correctly said by-Jerry Fritz, You’ll never have a product or price advantage
again. They can be easily duplicated, but a strong customer service culture can’t be
copied. A customer’s perception should be made a reality by the company. In this
way a company can design a well effective marketing strategy and pricing position.

6. 5
STRATEGIES TO FIGHT AGIANST LOW COST RIVALS
(With reference to HBR : Strategies to fight Low cost Rivals by Nirmalaya Kumar)
Ignoring the Low cost rival is a mistake because it would force the company to vacate from
the entire market segment. Low-cost players will continue to mushroom, and some will
succeed. However, there will always be two kinds of consumers:
 Those who buy on the basis of price
 Those who are partial to value.
Therefore, there will always be room for both low-cost players and value-added businesses.
How much room each will have depends not only on the industry and customers'
preferences, but also on the strategies traditional businesses deploy. If incumbents don't
take on low-cost rivals quickly and effectively, they can blame no one for their failure but
themselves.
Companies while fighting against low cost rivals can only have 3 options:
 Attack
 Coexist uneasily
 Become low cost player themselves
Price wars are not good strategies because it’ll hurt the company itself. Product
differentiation is a good strategy. Differentiation works the best under the following
conditions:
 Tactics are not used in isolation :
o Tactics which can be used by STMC:
 Offer a unique product mix like that of Combo offers or the entire
assembled component
 Pitching on to similar product manufacturing small scale companies.
 Selling experiences discussing in-depth of the functioning of the
machinery components that they sold to Tasaku.
 Costs and benefits are aligned before implementation
o Providing Tasaku a complete package for fitting, maintenance & replacement
at a subsidized price.
o Using or having a real time experience in usage of the manufactured
components by themselves so as to be aware of the real time issues that
company might face and providing solutions with least lead time.
o Keep track of the usage period or the running of components so as to help
the company to avoid Lead time in resuming work after any issues.

7. 6
 Customers are persuaded well to pay for the benefits
This can be done in any of the following ways:
o Acceptance of credit cards
o Making good contracts when selling products & services
o Making polite contact
o Giving customers credit period depending upon their buying

8. 7
STRATEGIES TO FIGHT AGIANST COMPETITORS
TMMC is the major competitor. The following points it should keep in mind the
following points while competing with the market leader:
 Differentiation: Differentiating yourself from your competitor is the best way
to compete. Approaches to differentiation include developing unique brand
images, unique technology, unique features, unique channels, unique
customer service or the like. In other words, the key to differentiation is
obtaining an advantage that is readily perceived by the consumer. Increased
costs can usually be passed on to the buyers due to the uniqueness of the
product attributes.
 Customer Satisfaction: SMTC has to go for CRM based strategy as its
competitor has a huge Brand image and so to overpower the image STMC has
to focus more on Client relations so as to stay in the race fearing no
competitors. They need to respond to the customers as fast as possible.
Companies can also thrive by putting customers at the centre of their
business.
 Positioning: One of the most important marketing strategies is to position
your product or solution differently. This doesn’t need to be the features or
service, but how the company markets its product or service. This is basically
done through public relations strategies and many effective marketers work
with the media to bring awareness to their products and the benefits their
products offer. Also, in many cases where things go wrong, a good PR
marketing strategy is vital. STMC should take a different approach for
marketing and should be different from that of TMMC. There are plenty of
opportunities to monetize through advertising. The key is in knowing who the
target customers are and allocating the resources to those specific channels.
 Identify Flaws and Opportunities: STMC should investigate and do more
market research in order to find what is missing in the offerings of the TMMC
or what market segment has been neglected. Once identified STMC can come
up with approaches to compete with the market leader.

9. 8
PRICING STRATEGY
Out of the multiple pricing strategies available, STMC can use the following pricing
strategies for the correct market positioning depending on the type of product.
New parts:
I. Premium Pricing: Premium pricing strategy establishes a price higher than
the competitors. This pricing strategy is used when the product has a quality
or has some unique features. Premium pricing can be a good strategy for
STMC while competing with TMMC while introducing a new parts/
components in the market if needed by the company for any future
requirements.
II. Price Skimming: Price skimming is a pricing strategy in which a marketer sets
a relatively high initial price for a product or service at first, and then lowers
the price over time. Businesses that have a significant competitive advantage
can enter the market with a price skimming strategy designed to gain
maximum revenue advantage before other competitors begin offering similar
products or product alternatives. As STMC is well known for quality of the
products, it can use this strategy for the new parts to be introduced in the
market against TMMC.
Existing Parts:
I. Penetration Pricing: Penetration strategies aim to attract buyers by offering
lower prices on goods and services. Penetration pricing does tend to result in
an initial loss of income for the business. Over time, however, the increase in
awareness can show results. STMC can use this pricing strategy against
TMMC/ low-cost rivals to reduce the prices of the existing parts/ components
thereby can capture the market and increase its sales volume and eventually
the profits.
II. Economy Pricing: It is used to attract the most price-conscious consumers.
With this strategy, businesses minimize the costs associated with marketing,
advertisements, PR and production in order to keep product prices down.
STMC can opt for a no frill very basic low cost approach to marketing, just the
bare minimum to keep prices low and attract a specific segment of the
market that is very price sensitive. Thereby in order to increase the profit it
can search out for other buyers as well for selling its parts and components.
Both New Parts & Existing Parts:
The below pricing strategies can be used for deciding on the prices of both
the new parts and existing parts:

10. 9
I. Bundle Pricing: With bundle pricing, multiple products/services can be sold
for a lower rate than consumers would face if they purchased each item
individually. STMC can bundle the services with the selling of the spares &
components to Tasaku Mills.
II. Discriminatory Pricing: It is the strategy of selling the same product to
different segments at different prices. In order to meet its target, STMC can
price the products based on the customer segment.
III. Market Based Pricing: It is the strategy in which the company evaluates the
prices of similar products in the market. STMC can evaluate or re-evaluate its
pricing strategy taking into account the competitor’s pricing for maximising
sales/profit.
MARKETING STRATEGIES TO BE FOLLOWED
Planning and implementing a growth strategy to develop new markets and expand
businesses before current market flattens out will not only help the businesses survive
tough times, it would also give them a considerable edge in the long run.
I. Market Expansion Strategies : The total market can be expanded by any of the following
ways :
1. Creating new users : New users could be added through several ways:
a. Market Penetration Strategy: Convince non-users of your products to use
your products
b. Aggressive strategy: Winning competitors customers
2. Discovering new users: This can be done by gaining new customers by targeting new
or underdeveloped geographical markets. Any of the below 3 strategies could be
followed in order to discover new ventures
a. Same Target Group, New Geographic Area
b. New Target Group, Same Geographic Area
c. New Target Group, New Geographic Area
The below points should be taken into account while expanding the customer base.
 Target Market is the customer group that is felt to most likely want to buy your
products or services. This group is defined by your customer profile.
 Customer Profile is a detailed profile of your typical customer. For individual
consumers, it includes information such as age, income, gender, marital status,
profession and buying habits. For businesses, it includes the types of business,
Geographical/Expansion
strategy

11. 10
number of years in business, number of employees, annual revenues and
products or services sold.
 Demographics are the characteristics of a population such as size, growth, age,
income, gender, marital status and buying habits. This information helps in
deciding whether this target market is large enough for your products or services
in the target area.
 Market Analysis is an analysis of research data that results in determinations
about the marketability of a product or service in the given market.
II. Defending current market share:
This strategy can be related to the theory that “Customer-retention is more profitable
than customer creation”. The current market cannot be endangered at any cost. While
increasing the total market, STMC must continuously defend its market of
manufacturing spare parts & components for existing machines to counter the attack of
rivals.
Along with playing defensive SMTC has to invest on continuous innovation, better
customer service, effective distribution processes and cost cutting which would lead to
increase market competitiveness. In short it can be said STMC has to maintain and
continuously improve its operational efficiency to avoid losing on customers. It is always
said “The best defence is a good offence”
Defence strategies that STMC can use are as follows.
o Position Defence: Position defence involves occupying the most desirable market
space in the minds of the consumers, making the brand almost impregnable. By
this way STMC can be successful in retaining its current market and can search
for new opportunities to pitch in.
o Flank Defence: It is one of the tactics of Marketing where a market leader not only
satisfies in Position defence but also puts up an outpost to defend the weak front.
Here, the purpose is to protect weak sides or fronts. Flank defence consists of setting
outposts to protect weak fronts that are vulnerable to be attacked.
o Mobile Defence: It is a defence mechanism used to protect the territories. STMC
would stretch or expand its domain (area) over new territories that can serve as the
future centres for offense as well as defence. It can be done through Market
Broadening and Market diversification.
III. Expanding Market Share
Other than only defending or expanding the businesses prefer improving their
profitability. But increasing market share will not always result in increasing
profitability. It depends on various variables which lead to profitability after
market expansion. Few are the variables which lead to the same:

12. 11
 Adding new product lines: In order to increase market share STMC is
considering to add new and diversified products to its line of production to
make it an attractive product mix. However before that STMC has to check for
the demand of new machines or their parts to be used further.
 Improving existing product line: This can be a way for STMC for expanding
existing product line by adding features of durability, reliability, safety,
convenience etc. This strategy would definitely lead in increasing customer base.
 Skimming price: To fight low-cost competitors STMC has to strategize on
reducing prices of certain components so as to generate volume in sales and in
turn extensive benefits from the economy.
 Partnering with Allies: Partnering with competitors has always been a wise
decision when the market is competitive. Here STMC has to partner with its allies
so as to make sure of its long term existence. On contrary marketing alliances
and partnering are cheaper to create and see success very quickly and thereby
making the product visibility more.